Thanks in advance for any suggestions.
Situation is this - There is this lake front camp that my wife’s family has been going to her whole life. Back in 1980 the land was converted from rentals to a condo association with all ten cabins being association members.
Within the original bylaws was a provision that any association members had a right of first refusal on cabins for sale (unless sale was to a blood relative).
One of the cabins recently came up for sale and was sold to a non-association member; as a result all of the ten owners now have a right of first refusal on the asking price. My mother in law is an association member but we are not. As a result, since my wife desperately wants to own a cabin (lucky me), we have to now make any offers through my mother in law. What I am trying to figure out is how do we give the money to my mother in law to buy it and then transfer the deed over to us without implicating any sort of crazy tax laws. Not sure if it is relevant but we will be paying cash so no mortgage implications or the like.
If it gets to the point where our bid is the winning offer I will obviously be working with a real estate attorney, but because it would be a local Mainer I kind of wanted to have an idea of transfer options prior to that discussion because who knows what their skill level will be.
Have her close on the purchase, and sell it to you the next day. On the closing statement for the purchase from your MIL, you get a credit for repayment/satisfaction of the loan, so no cash (or only some small amount) is due, and no taxable gain to your MIL.
Disclaimer that I’m neither a lawyer nor a tax/estate professional.
I understand what would make one nervous going into a situation like this.
I represent a campground that operates on a similar basis. This is either going to work because everyone involved wants it to work - or it's going to be a nightmare. There is no way to 100% legally protect yourself when it comes to these things. Some of it is going to have to be based on faith.
I advise you to become real familiar with the camp's legal structure and then make a point to meet with some of the principals and tell them what you have in mind. That will give you a strong indication of which way the wind is blowing on this. I would ask them for advise on how to proceed.
The bottom line is, you are contemplating living amongst these people, and owning part of what they are. They can make things a lot easier for you - or visa versa - and the same goes with your mother in law.